The VIX May Be Approaching A Turning Point

By Michael J. Kramer of Mott Capital Management

Founder/CEO at Mott Capital Management, LLC • Oct 21, 2026 at 5:24 PM EDT

The VIX approaches a potential floor as heavy central bank schedules and tech earnings threaten a volatility spike.

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Stocks moved higher today, as implied volatility continued to decline following its sharp rise on Friday. The model suggests the VIX still has room to fall further, so it wouldn’t be surprising to see the rally continue another day or so. We have to remember, though, that volatility will flip next with a heavy schedule that includes the Fed, ECB, BOJ, and a PCE report. Plus, we still have a mid-term election coming, and mega-cap tech earnings. So we’re more likely closer to the floor.

The dispersion index looks like it’s in a rising wedge, and at this point in earnings season, it wouldn’t surprise me at all if dispersion started to unwind and correlations began to rise.

The Italian-Germany 10-Year rose to 1.16%, putting it back at its widest point this period. It just seems to me from looking at this spread alone its heading a direction that moves wider, and given the importance of this spread, it would seem to me that spreads globally are going to widen.

TradingView chart of IT10Y-DE10Y spread, 2021-2026, at 1.162%, up 2.81%, with hand-drawn red trend arrows marking peaks, declines, and recent breakout from a base; RSI below at 64.91

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